Why Corporations Exist LO10220

Glenn Waring (waring@zeus.franklin.edu)
Sat, 28 Sep 1996 10:58:40 -0400 (EDT)

The late Maurice Mascaranhas, who was a Resource-of-the-Year for my
organization which counsels 4,000 CEOs around the world, used to say,

"Profits are like breathing. You have to have them.
But who would stay alive just to breathe?"

I laid this line on my students in an MBA class and got a fairly hostile
reaction, too. Grade-grubbers that they are, they didn't argue very much
with the ol' professor. But you inspire me to raise this again and again
until they get it.

OF COURSE corporations don't exist to make profits. Stanford's research
of 1994, compiled in a book called Built to Last, makes the point that all
the great corporations have a well-understood statement of purpose.
Merck, for example, says its purpose is to preserve human life. That
becomes a field operating manual that really helps make decisions. By the
way, it's also a pretty rewarding stock to hold -- true for most of the 18
companies cited in the book.

Good debate here -- keep up the good digest work. There is NO WAY I could
drop in without the good digest.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Glenn Waring, Chairman
The Executive Committee / Community Methods
2681 Montcalm Road
Columbus, Ohio 43221-3452
waring@zeus.franklin.edu
614-486-8522 bus/fax
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

-- 


Glenn Waring <waring@zeus.franklin.edu>
 


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